Whitestone REIT (NYSE: WSR) and One Liberty Properties (NYSE:OLP) are both small-cap finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, earnings, institutional ownership, profitability, risk, dividends and analyst recommendations.

Profitability

This table compares Whitestone REIT and One Liberty Properties’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Whitestone REIT 4.36% 1.69% 0.54%
One Liberty Properties 29.14% 7.49% 2.92%

Insider & Institutional Ownership

43.8% of Whitestone REIT shares are owned by institutional investors. Comparatively, 41.7% of One Liberty Properties shares are owned by institutional investors. 5.3% of Whitestone REIT shares are owned by company insiders. Comparatively, 8.6% of One Liberty Properties shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Earnings & Valuation

This table compares Whitestone REIT and One Liberty Properties’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Whitestone REIT $112.35 million 4.50 $49.43 million $0.13 101.01
One Liberty Properties $74.78 million 5.99 $48.43 million $1.17 20.56

Whitestone REIT has higher revenue and earnings than One Liberty Properties. One Liberty Properties is trading at a lower price-to-earnings ratio than Whitestone REIT, indicating that it is currently the more affordable of the two stocks.

Dividends

Whitestone REIT pays an annual dividend of $1.14 per share and has a dividend yield of 8.7%. One Liberty Properties pays an annual dividend of $1.72 per share and has a dividend yield of 7.1%. Whitestone REIT pays out 877.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. One Liberty Properties pays out 147.0% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Whitestone REIT has raised its dividend for 4 consecutive years. Whitestone REIT is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Whitestone REIT and One Liberty Properties, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Whitestone REIT 1 1 2 0 2.25
One Liberty Properties 0 2 0 0 2.00

Whitestone REIT currently has a consensus target price of $14.67, suggesting a potential upside of 11.70%. One Liberty Properties has a consensus target price of $24.75, suggesting a potential upside of 2.87%. Given Whitestone REIT’s stronger consensus rating and higher possible upside, equities analysts clearly believe Whitestone REIT is more favorable than One Liberty Properties.

Volatility & Risk

Whitestone REIT has a beta of 0.93, suggesting that its share price is 7% less volatile than the S&P 500. Comparatively, One Liberty Properties has a beta of 0.82, suggesting that its share price is 18% less volatile than the S&P 500.

Summary

Whitestone REIT beats One Liberty Properties on 10 of the 17 factors compared between the two stocks.

About Whitestone REIT

Whitestone REIT is a real estate investment trust. The Company is engaged in owning and operating commercial properties in culturally diverse markets in various metropolitan areas. The Company’s acquisition targets are located in densely populated, culturally diverse neighborhoods, primarily in and around Austin, Chicago, Dallas-Fort Worth, Houston, Phoenix and San Antonio. As of December 31, 2016, the Company owned or held interests in 69 commercial properties, including 15 properties in Houston, five properties in Dallas-Fort Worth, three properties in San Antonio, four properties in Austin, 27 properties in the Scottsdale and Phoenix, Arizona metropolitan areas, and one property in Buffalo Grove, Illinois, a suburb of Chicago. As of December 31, 2016, the Company’s properties included Heritage Trace Plaza, Headquarters Village, La Mirada, The Marketplace at Central, Mercado at Scottsdale Ranch, Paradise Plaza, Parkside Village North, Pima Norte and Quinlan Crossing.

About One Liberty Properties

One Liberty Properties, Inc. is a self-administered and self-managed real estate investment trust (REIT). The Company acquires, owns and manages a geographically diversified portfolio consisting of retail, industrial, flex, and health and fitness properties. As of December 31, 2016, the Company owned 114 properties and participated in joint ventures that own five properties. These 119 properties are located in 30 states and have an aggregate of approximately 10.1 million square feet (including an aggregate of approximately 1.2 million square feet at properties owned by its joint ventures). As of December 31, 2016, the Company’s property locations included Fort Mill, South Carolina; Royersford, Pennsylvania; Round Rock, Texas; W.Hartford, Connecticut; Delport, Missouri; Brooklyn, New York City; Lakemoor, Illinois; Tucker, Georgia; Cedar Park, Texas; Lake Charles, Louisiana; Sandy Springs, Georgia; Wichita, Kansas; Melville, New York; Ronkonkoma, New York, and Niles, Illinois.

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